Starting out in Forex (3)
Technicals
I use mainly a daily chart and a hourly chart. On both, I have WMA5 (cyan), EMA21 (green), EMA55 (blue), EMA100 (yellow) and EMA200 (red). In additional I have, CCI(34) fused with BB(14, 0.9) and BB(14,0.3).
The concepts I adopt was based on David Kolachi method of trading, http://www.kolachitrader.net. I do not know now if the explaination is still free. Its quite a theorem by itself. My analysis starts with the daily chart. In days where there is no dispersion, and the direction is clear, I will use a fibonachi retracement to set my take profit or resistance /support line. In days of dispersion, the resistance and support line is set using the nearest EMA line.
Similarly, using a hourly chart, the method is the same for days when there is no dispersion. In days where there is dispersion or when a dispersion is about to take place, I use a breakout method, the entry is set at either above/below the EMA200. On a day of dispersion and a rebound of the WMA5 is expected, I will set a U-turn entry at the next EMA.
A bit difficult to explain, if you are not familiar with Kolachi Theorem, Fibonachi Retracement and concepts of breakout. For the later two, do a search on any forex trading method and you can get some explaination. I follow Eillot Wave Theory at times, so do read them.
The best way is to follow my daily trade diary. I always start with a overall analysis of the market and explain how I expect the WMA5 will move for the day (either using a hourly chart or a daily chart). Next, I will normally explain where to entry, trace the entry on your chart and you can see whether the trade is set up for U-turn or for breakout. The last thing I highlight is the take profit support or resistance line. These are predicted using either Kolachi concept of WMA5 and EMA behaviour in days of dispersion, or by fabonachi or Elliot Wave theory to determine the level of support or resistance.
The above may be enough, but to have an addition confirmation, I have a set of lower indicators. A combination of CCI(34), BB(14,0.9) and BB(14,0.5). A daily chart is used. The oversold and overbrought is set at +/-150. When there is an oversold or an overbought situation, enter when CCI(34) cuts the BB(14,0.9). Exit when CCI(14) punches through the BB(14,0.9) and a change in gradient happen. Watch out for rebound of CCI(14) on BB(14,0.9) or BB(14,0.5). You may want to abandon position.
For case without oversold or overbought, enter when CCI(14) cut BB(14, 0.5). Exit likewise like the mention above.
Confuse? I will explain with more charts, which I will take time to prepare. But in the meanwhile, follow my trade daily and try to understand the underlying reasonings.
I use mainly a daily chart and a hourly chart. On both, I have WMA5 (cyan), EMA21 (green), EMA55 (blue), EMA100 (yellow) and EMA200 (red). In additional I have, CCI(34) fused with BB(14, 0.9) and BB(14,0.3).
The concepts I adopt was based on David Kolachi method of trading, http://www.kolachitrader.net. I do not know now if the explaination is still free. Its quite a theorem by itself. My analysis starts with the daily chart. In days where there is no dispersion, and the direction is clear, I will use a fibonachi retracement to set my take profit or resistance /support line. In days of dispersion, the resistance and support line is set using the nearest EMA line.
Similarly, using a hourly chart, the method is the same for days when there is no dispersion. In days where there is dispersion or when a dispersion is about to take place, I use a breakout method, the entry is set at either above/below the EMA200. On a day of dispersion and a rebound of the WMA5 is expected, I will set a U-turn entry at the next EMA.
A bit difficult to explain, if you are not familiar with Kolachi Theorem, Fibonachi Retracement and concepts of breakout. For the later two, do a search on any forex trading method and you can get some explaination. I follow Eillot Wave Theory at times, so do read them.
The best way is to follow my daily trade diary. I always start with a overall analysis of the market and explain how I expect the WMA5 will move for the day (either using a hourly chart or a daily chart). Next, I will normally explain where to entry, trace the entry on your chart and you can see whether the trade is set up for U-turn or for breakout. The last thing I highlight is the take profit support or resistance line. These are predicted using either Kolachi concept of WMA5 and EMA behaviour in days of dispersion, or by fabonachi or Elliot Wave theory to determine the level of support or resistance.
The above may be enough, but to have an addition confirmation, I have a set of lower indicators. A combination of CCI(34), BB(14,0.9) and BB(14,0.5). A daily chart is used. The oversold and overbrought is set at +/-150. When there is an oversold or an overbought situation, enter when CCI(34) cuts the BB(14,0.9). Exit when CCI(14) punches through the BB(14,0.9) and a change in gradient happen. Watch out for rebound of CCI(14) on BB(14,0.9) or BB(14,0.5). You may want to abandon position.
For case without oversold or overbought, enter when CCI(14) cut BB(14, 0.5). Exit likewise like the mention above.
Confuse? I will explain with more charts, which I will take time to prepare. But in the meanwhile, follow my trade daily and try to understand the underlying reasonings.
posted by Ernest Seng at 9:58 PM
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